From sewing baby clothes to up-cycling old thrift store furniture, more and more people are turning their hobbies into side businesses. And with the ever-increasing Etsy population as well as endless free social media platforms, launching a side business is easier than ever before.
You don’t even have to be an aggressive go-getter with a startup and investors to make money on your own terms. You can market your product from the comfort of home with nothing more than your skill and a Facebook page.
The ease of turning your hobby into a business is also why, for many people, it happens by accident. It typically starts out like this: Let’s say you post that painting you made for your sister to Facebook, and then, through all the shares and likes, you get more requests. As you begin to fulfill more and more orders, you eventually realize: “Hey! I can make money at this while doing something I love to do anyway!”
The natural growth most side business owners experience sweeps talented and passionate people into a form of entrepreneurship that they may not have otherwise considered.
But with the ease of getting into a side business also comes a very common challenge. Since it starts as a hobby, it’s often very tempting for people to call it a business, but continue treating it like a hobby. That’s the main mistake that people with side businesses make!
So the first step to turning your hobby into a business is this: Treat it as a business. You can do this by understanding the difference between a hobby and a business. A business makes you money. A hobby costs you money.
It sounds simple, but many people miss this reality. They say things like, “Oh, I don’t care about the money. I just do it because I love it!” Of course a hobby is something you should love, but you also have to realize that love isn’t enough to make a business work. You also need profits.
Now, if you want to build a line item into your budget for your hobby and continue to fund it, great! But if you want to share your gift with the world long-term, you have to make a profit in order to continue doing it. Profits are critical not only to your finances, but they also help you justify the time invested in your passion when you’re away from your family each week.
If it’s not making you money, it’s pretty tough to justify spending 10, 20 or 30 hours a week on something that has no financial return, just because you love it. Both a hobby and a business can and should be fun, but if it’s not making money it’s not a real business that can grow or last.
So if you want to turn your hobby into a business, you must treat it like a business. That comes from recognizing and accepting the reality that in order for it to work, it has to make you money. Once you understand this, you can build your business in a way that will keep costs down, increase revenue and ultimately create a profit for you. It’s those profits that enable you to continue to do what you love to do and to share that love with the marketplace.
And that is good business!